Kiwi tipped to rise back above 80 US cents
Tue, 12 Jun 2012 5:31a.m.
The inaugural ASB Institutional Kiwi Dollar Barometer released on Tuesday shows that businesses see potential for the kiwi to ease further against the greenback in coming months before staging a recovery.
The average exchange rate expectation is higher among importers than exporters.
Importers, on average, expect the kiwi to recover to 77.2 US cents by the end of this year, and reach 80.3 US cents by March 2013.
The average expectation among exporters is for the kiwi to ease further to 74.8 US cents by the end of this year and recover to 78.4 cents by March 2013.
ASB Economics forecasts the kiwi to recover even higher - to 83 US cents in March 2013.
"The extent to which the NZD lifts will depend on how successful Europe is in containing the ongoing debt crisis, which has pulled the NZD down recently," said ASB chief economist Nick Tuffley.
Over 350 businesses were interviewed for the survey from May 9-15, after the kiwi plunged below 80 US cents and the Reserve Bank said the currency may fall further because of a deterioration in market sentiment and lower commodity prices.
The survey also asked businesses how the recent strength in the New Zealand dollar has affected their investment plans.
Just over 60 percent of businesses that only import reported the high dollar has increased their investment plans.
In contrast, around 53 percent of businesses that only export report the high dollar has led them to reduce their investment plans.
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13/06/2012 6:27:48 a.m.
How about an indication in export % vs this 53% of businesses surveyed ...According to this survey we have a 2 bit exporter sending samples by mail overseas equated to Fonterra! This is bullshit surveying at its worst.Will the Kiwi rise above 0.80 US? Probably as the NZ economy is still in better shape than the USA, and the EU.So what is the left solution? Pin our dollar to another currency? The Australian which has risen more than the NZ$? The Chinese currency as it also has risen more than the NZ$? Thats our 2 biggest trading partners! Pin to the US currency as the left loves the USA!Pegging our currency to another doesn't work and would just cost NZ more. Eg the IMF says we have too much external debt and suggests a 15% lower dollar, as this would raise external debt to be repaid almost 18% - how is this beneficial to NZ?
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